At the height of the Pandemic Housing Boom last spring, Zillow economists remained bullish and predicted that national home prices would skyrocket another 17.8% between February 2022 and February 2023. However, as mortgage rates crossed over 6% and the housing market slipped into a slump, Zillow started slashing that aggressive home price forecast. By December, Zillow was predicting that national home prices would fall 1.1% between November 2022 and November 2023. Fast-forward to May, and Zillow is slowly drifting back into the housing bull camp as the U.S. housing market stabilizes amid the higher mortgage rate environment, and home prices in most markets are starting to rise again.
Heading forward, Zillow's forecast model expects U.S. home prices, as measured by the Zillow Home Value Index (ZHVI), to jump 4.8% between April 2023 and April 2024. For perspective, national home prices as tracked by ZHVI have averaged an annual appreciation rate of 5.08% since 2001.
